TRUNG NGUYEN LEGEND – AWAKENING BRAND

In the current issue of August 2022, Forbes Vietnam honored Trung Nguyen Legend as the “Awakening Brand” in the special article about the leading F&B brands in 2022.

Forbes is a major global financial and economic magazine, being well known for its lists and rankings on different topics about businesses, people, and places. 10 years ago, in July 2012, Forbes honored Mr. Dang Le Nguyen Vu – Founder and Chairman of Trung Nguyen Legend Group as the Coffee King in an article about his vision and desire to build brand name for Vietnam’s coffee (https://www.forbes.com/global/2012/0806/companies-people-dang-le-nguyen-vu-vietnam-coffee-king.html).

In 2018, Trung Nguyen Legend was honored in the list of 40 most valuable brands by Forbes Vietnam. Recently, with the brand equity of 54.4 million USD, Trung Nguyen Legend continues to be named among the Top 10 List of 25 leading F&B brands announced by Forbes Vietnam. With great vision and different branding strategy of Trung Nguyen Legend, Forbes Vietnam has published an analysis about Trung Nguyen Legend brand on the August 2022 edition. Here, we would like to quote and republish this article of Forbes Vietnam to share with readers.

At the end of June 2022, to celebrate the 26th anniversary of Trung Nguyen Legend Group, at the World Coffee Museum in Buon Ma Thuot city, the Opera about three coffee civilizations was performed for the first time. “The Tale of the Three Coffee Cultures – The begin a Tao of Coffee” took place on stage with a unique and lively design, explained the idea of elevating the Vietnam coffee industry to the level of culture – art – philosophy from Mr. Dang Le Nguyen Vu, the founder and chairman of Trung Nguyen Legend.

The Opera is expected to become a tourism product contributing to the project of building Buon Ma Thuot’s brand into “The coffee city of the world” and welcoming the festival “Dak Lak – Destination of the world’s coffee” in 2023. Viewers were guided through a variety of contexts that show how the coffee drink has become an important part of life, a catalyst that creates discourses, exchanges or connection ideas. Mr. Vu wants to lead Trung Nguyen Legend to approach the values ​​that he thinks Vietnamese coffee deserves and turn coffee into a “coffee ceremony like the Japanese tea ceremony”. Among the sounds, dances, and costumes typical of Ottoman, Roman, or Zen civilizations (the idea that Trung Nguyen wants to promote), in the ending scenes of each civilization is the image of coffee tree, coffee beans or coffee flowers. Coffee becomes the center of the stage honoring itself, in a unique world coffee museum invested around 200 billion Dong.

In a press release, Trung Nguyen Legend said that they devoted a lot of effort to researching the history of coffee in all areas of human life to fundamentally and comprehensively rethink world coffee, step by step perfecting the ecosystem of “physical coffee – social coffee – spiritual coffee”. In particular, the essay “Philosophical Coffee” published on media channels is a way for Trung Nguyen to explain coffee and shape the brand. “It’s a very difficult goal,” said Pham Thi Diep Giang, Communications Deputy General Director of Trung Nguyen Legend group, about the desire of the group to make coffee at the level of “philosophy” and said, “In the coming years, Trung Nguyen Legend will be consistent in this target!”.

The plans and thoughts recorded by the leaders of the group many years ago are gradually being realized into visible products at the World Coffee Museum or through the opera. In this big annual event of the company with the participation of ambassadors, consulates or trade representatives of some countries, Chairman Dang Le Nguyen Vu was not present.  For nine years, after a period of many changes in the brand, especially after a controversial divorce, Mr. Vu rarely appears in public and does not give interviews to Forbes Vietnam for this article.

According to the Brand Footprint 2022 report of Kantar Worldpanel, Trung Nguyen and G7 are two coffee brands in the Top 10 most-chosen beverage brands by Vietnamese consumers in urban areas in 2021. In rural areas, G7 is also in the top 10. Trung Nguyen Legend owns five factories in Vietnam and more than five thousand employees, annual revenue of more than five thousand billion VND and several hundred thousand points of sales of distributors. The group operates the Trung Nguyen Legend coffee chain in the mid-tier and high-end segment, currently has 80 locations (60% self-operate and 40% franchise) and the E-Coffee retail system in the popular segment with 800 existing locations (95% according to the 0 dong franchise model).

In order to continue to promote the idea of ​​​​making “philosophical coffee”, Trung Nguyen Legend develops a model of the Coffee World flagship store, where customers can learn about the Trung Nguyen coffee ecosystem, in which there are new product lines, carrying messages promoting “a mindfulness lifestyle” such as Zen coffee, with spaces and tools for meditation. In addition to the three domestic locations, there will have one more location in Shanghai in September.

Trung Nguyen Legend is one of the rare Vietnamese businesses that build a brand through many enduring activities, with stories about products and is related to culture, creating a community that believes in the values of the company is aiming for. From the early days, Trung Nguyen has been associated with the spirit of entrepreneurship, with events that enhance the image and value of Vietnamese coffee – the second largest Robusta coffee exporter in the world, after Brazil..

Through the products, Mr. Vu promotes a “coffee lifestyle”, or a different mindset, greater than common sense. Trung Nguyen Legend named its brand name associated with No.1, images of famous people, great people, quotes or their thoughts are shown at prime store locations in urban areas or a variety of products… They also compare the process of making, processing, brewing coffee, or designing coffee equipment with the process of designing and manufacturing expensive supercars. The enterprise also manufactures books, gives books from “The life-changing foundation bookcase” that Mr. Vu selected lasting many months, in many remote locations with the participation of many beauty queens on supercars of group to give and talk. The way Mr. Vu built his brand is associated with debates, which can make the public curious, interesting, and even bewildered. However, there is no denying the consistency of the brand: always focus on being different. Brand naming also shows aspiration, which is No.1 and Legend.

In a public appearance at the divorce trial in 2019, Mr. Vu continued to talk about his desire to lead Trung Nguyen Legend with “different, special and unique” strategy stemming from the fact “after 20 years, Trung Nguyen Legend is not new anymore”. With the current market size, Vietnam has received most of the major coffee brands in the world, creating fierce competition.

“So it must be determined that this is the investment stage, not the brand exploitation phase,” explained Mr. Vu for the branding investment activities that many people consider “wasteful and unnecessary”. Specifically, according to Mr. Vu: “When returning to the ‘different, special, unique’ frame of reference, it means going to the stage of changing technology, training people both outside and inside. Typically, during that period 10% of expected revenue flows to marketing. For example, in 2019, if it is expected to be five trillion dongs, it is allowed to deduct 10-15% for other things. Instead of using it as a normal business discount, I use it to gain indirect affection.” The concept of “indirect gratification” through activities under the two pillars of “spiritual coffee” and “social coffee” that Mr. Vu believes helps to leave heritage and create value for society.

Not every activity convinces experts of effectiveness. Many people believe that activities such as giving books are just on the surface but have not changed the inside. According to media expert Nguyen Dinh Thanh, it takes time to measure the effectiveness of qualitative changes in the book donation campaign. However, Mr. Thanh highly appreciated that Trung Nguyen Legend is a rare enterprise in Vietnam that uses culture to build its brand through activities such as giving books, building the world coffee museum, creating a discussion topic “Vietnam is big or small” or sponsoring spaces to discuss, exchange about culture, start-up of the intellectual and social community with a variety of topics. There are long-term programs such as “the Saturday Coffee space” led by musician Duong Thu, which has now entered its 13th year. “It’s a civilized way of doing things,” Mr. Thanh told Forbes Vietnam: “I appreciate Trung Nguyen to be one of the strong brands of Vietnamese enterprises until now, not foreign-owned”.

The franchise expert Nguyen Phi Van commented to Forbes Vietnam: “The way Trung Nguyen has built its brand so far has been a great success, there is no doubt. But their challenge is to innovate the brand itself, the business model to catch up with the market.”

“The economy is to serve, if we serve the community with the heart of responsibility, the community will have a little affection, not just promoting in a continual flow,” Mr. Vu said at the divorce court, attracting the attention of the public. “With such a program, having to connect, take a lot of energy, and indirectly endure, especially in the context that many leading coffee corporations in the world have entered Vietnam, how far Trung Nguyen can go?”

The coffee world is experiencing through the fifth coffee wave model, trend of a boutique shop model with clear, unique, and inspiring design ideas, products, and services that are constantly innovating. According to Ms. Pham Thi Diep Giang, Trung Nguyen Legend does not pay much attention to trends, and has not consulted market reports for many years, but follows the way the business has determined in advance “even though there are many internal conflicts”. In the early 2010s, Mr. Vu started to meditate. In 2018, Trung Nguyen officially changed its name to Trung Nguyen Legend and changed the brand identity system from the basalt red of Buon Ma Thuot land where Mr. Vu established his career to black – white and yellow. Designs, images, and decorations in coffee shops all returned to these primary colors. Now, Trung Nguyen Legend wants to create a sense of solidity, minimalism, space associated with images of famous people, great people, and quotes that inspire people to think differently, beyond the pattern.

Trung Nguyen coffee shops are promoted as not only offering coffee but also “dreams”. Both at Trung Nguyen Legend and E-Coffee are displaying books from the bookcase “The life-changing foundation bookcase – The Journey of Setting Great Mindset” in many fields, Science, Philosophy, Occult Science, Medicine, Martial Arts, Economics & Finance, Politics, Ethics, Sociology, Aesthetics, Audio Studies and Linguistics. The serving menu is set according to the keyword “energy”, from “purifying energy” for drinks, “loving energy” for desserts to “macrobiotic energy” for food.

Mr. Vu used to be an excellent business speaker, often sharing his views of life and his aspiration to make a radical change in social life. Dang Le Nguyen Vu’s personal name associated with Trung Nguyen Legend for the past 26 years has created success and countless controversies. “Personal brand associated with brand can create many risks. In general, the way corporate communication focuses on individuals can be dangerous because people are sometimes good and sometimes bad,” commented Mr. Thanh. And Ms. Phi Van said that a business should be very clear about identifying the personal brand of the business owner with the product brand. “If we don’t maintain the consistency between the product/business brand and the personal brand (of the business owner), it will create confusion in the market about the potential of that brand’s development in the future. Previously, according to Ms. Van, was a business brand “close” to the Vietnamese people, while Trung Nguyen Legend looked like a professional coffee chain.

Previously, Trung Nguyen brand was identified and tended to be associated with history, with the old generation, the boom of globalization. Currently, the trend of globalization is slowing down, along with the changes of the new generation of consumers, putting pressure on Trung Nguyen to improve from products, designs to communication methods to suit new customers. “I think new brands should be just a part of the empire, separate from Trung Nguyen,” Thanh said, and said that Trung Nguyen should be a combination of many brands, if Trung Nguyen is kept as the background brand. Platforms like today can make it difficult to position new brands targeting new consumer classes. “The reason Trung Nguyen has not been successful with new brands is because still attached to Trung Nguyen, causing customers to face psychological barriers. Imagine CJ of Samsung empire, very few people know CJ belongs to Samsung because it seems that these two brands are not related”, according to Mr. Thanh.

However, according to Ms. Diep Giang: “We are consistent with the goal of elevate coffee at the level of art, lifestyle, philosophy”. One of Vu’s favorite books is “Differentiate or Die”. Mr. Vu once said: “If you want to go global, you must have a strategy. To do so, it is necessary to know what is the difference between Trung Nguyen and leading corporations, especially, its uniqueness compared to Starbucks and Netslé. It has to be different from the service model to the product structure.